Hiring the Right People

The cost of hiring the wrong person

One in three people believe hiring the wrong person costs their business nothing. However, research suggests a poor hire can cost the company between 30% of a person’s first year earnings to three times a person’s annual salary. In addition to the financial impact, a poor hire can also decrease productivity, create cultural imbalance, and tarnish your company’s reputation.

Jim Collin’s advice from Good to Great:

 

1) Get the right people on the bus

2) Get the right people in the right seats, and

3) Get the wrong people off the bus.

Q): Why do poor hiring decisions happen?

CareerBuilder found that 43% of those surveyed said they made a poor hire because they felt the need to hire somebody quickly. In addition, the survey found 20% of people admitted to having a lack of skills to interview and hire people effectively.  (Society for Human Resource Management, 2017)

Q): Why is turnover so costly?

Because of the following costs (provided by the Society of Human Resource Management):

  • Recruitment, advertising fees, and staff time

  • Relocation and training fees for replacement hires

  • The negative impact on team performance

  • The disruption of projects

  • Lost customers

  • Outplacement services

  • Weakened employer brand

  • Litigation fees

Q): How can I improve my hiring practices?

A): Volume Selection

Volume selection processes can improve quality and decrease turnover.

High-volume selection refers to a strategy used by organizations and/or franchise networks who hire large groups of people. For instance, this could include seasonal hiring or continuous high-volume hiring due to a consistent demand. SOLVE’s high-volume selection solution allows you to make more informed hiring decisions and be consistent in the process. Benefits of using an effective selection process include decreased costs and improved efficiencies within the hiring process. In addition, other benefits include decreased employee turnover and happier, more productive employees.

How the process works:

 

First, we explore the future candidate’s role and what it takes for an employee to be successful. Next, we customize our tools to measure the most critical factors and key traits, which provide a prediction of someone’s likelihood of success in those key areas. The resulting report provides a snapshot of the employee’s capabilities in a simple-to-read format. Lastly, we validate this profile with performance data to ensure we’re assessing the right traits and weighting them appropriately.

Q): How can I ensure I hire the right leader?

A): Executive Selection

Executive selection is different from other types of employee hiring.

Hiring the right executive has a tremendous impact on an entire organization. According to research, high-performing executives can add millions of dollars to their company’s bottom line. However, failure rates for senior executives are increasing and the rate of CEO turnover is even higher. For example, CEOs appointed in the last 25 years are three times more likely to be fired than CEOs appointed earlier (Zaccaro, 2010).

 

Therefore, executive selection requires a different process and use of tools. Executive selection is unique due to the high costs associated with failure, a smaller market from which to recruit, and the number of internal stakeholders who often want to be involved. In other words, hiring a leader calls for greater patience and confirmation of biases.

 

Effective executive selection must include an evidence-based approach with assessments. The goal is to match the candidate’s characteristics with the role and the candidate’s character to the values of the company. Contact SOLVE to learn more about our executive selection process.

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Let SOLVE help you hire the right person using evidence-based solutions and proprietary technology.

Learn more about our web-based hiring and assessment platform.

HireForward®

COMING SOON! Check out our analysis of assessments, which reviews the most common personality tests used in hiring processes.

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